One downside of writing a lot is that sometimes you miss the mark. I think that happened here: Let’s Find Out. Not that I was wrong per se, but I failed to capture the idea I was trying to get across. What I should have written about instead was the relationship between courage, conviction, and success.
I learned from gambling in Las Vegas that the smartest gamblers frequently are not the richest. Most of them have comfortable middle class assets, but very few are millionaires. Now, you might ask how I know these were the smartest guys at the card table. But it was easy to tell: they were convinced of incredibly smart things and happy to tell you about it.
One great example arose around the 2007 super bowl between Indianapolis and Chicago. For those not in the know, all sorts of betting outlets offer superbowl prop (short for proposition) bets. These bets allow you to wager modest amounts of money (maybe up to $1000) on wacky aspects of the game. Who will win the coin toss? How long will the national anthem take to sing? Weird shit like that. Most of them, like the coin toss bet, are suckers propositions. Who wants to risk 11 to win 10 on a 50:50 coin flip? But some of them (such as the anthem) can offer intriguing gambling opportunities.
The 2007 superbowl featured a rather bizarre one even by prop bet standards: which number would be larger?
- number of running plays by Chicago quarterback Rex Grossman
- number of Grammys won by the Dixie Chicks in 2007
You could have either side of the bet by wagering 11 to win 10.
Now, mixed in among all the other lame bets it would be easy to miss this one. I never noticed it. But another pro poker player I regularly played with did. His observation: Rex Grossman almost never ran – about 1 play per game on average. Most of those were kneel-downs at the end of winning games which count as runs. The over/under on Dixie Chick Grammys alone was 4. It’s impossible to have more than 3 kneel-downs at the end of a football game. Chicago wasn’t likely to win (and thus kneel out the game) anyways – Indy was by far the better team.
Moral of the story: betting on the Dixie Chicks was nearly free money. Even if they won zero Grammys the bet would likely be a push and you’d get your money back.
Now, my pro acquaintance explained all this to me in detail. His analysis was exactly correct. My only contribution to the process was recognizing the correctness of his reasoning. But even that’s being smart, lazy edition. Now, do you want to guess how much money he and I made on this little nugget of wisdom?
Nothing. We never bet it.
What we should have done is attacked that bet like a pit bull on a t-bone. Bet it the max at every place we could find, hire sports book runners to bet it again and again and again until bookies dreaded hearing the words Dixie Chicks. Force every available betting outlet to either move the line to at least Grossman +2.5 or take the bet off the board. We did exactly none of that. Instead someone eventually posted about the bet on a popular poker board, which in turn caused someone else bet the world. I just used the bet as trivia to amuse (or baffle?) my friends while watching the game.
Rex ran zero times. The Dixie Chicks won five Grammys. See how smart we were?
The point here is that conviction is not enough. You typically need conviction. It’s fairly necessary. But it’s not enough. Once you’ve got conviction, you’ve got to back it with a healthy dose of courage. Courage is hard. Courage makes people look at you funny and wonder why you have $25,000 riding on the Dixie Chicks. But courage coupled with the right convictions makes you rich one Grammy at a time.
It’s easy to fall into the trap of intelligence leading to conviction without courage. The payoff is that you get to show everyone how smart you are. My friend showed the whole poker table. I showed all my Superbowl party buddies. Look how fucking smart we are! But we didn’t make a cent. This blog, much as I love it, is an exercise in conviction without courage. I get to show everyone how smart I am (feel free to dispute that privately or publicly) without having to back my convictions with anything. I do trade money on some of my strategies, but if I had courage I would have traded more, and I’d be richer. Courage is what I need to work on.
The opposite, of course, is ample courage coupled with false convictions. That’s worse than correct convictions with no courage. Instead of making no money you lose. Now, sometimes that’s OK. The point of “Let’s Find Out” was that if the downside is very limited and the upside huge then courage is enough. But there are other situations, and trading offers up lots of them, where false convictions are extremely costly.
The tricky part is that right conviction and courage are almost opposites. Right convictions are achieved by analysis and critical thinking. Take the proposition, look at if from both sides. Consider the evidence. Be cautious and self-critical. Be smart. Courage is more like lock-in. You KNOW you’re right. You don’t care what other people think. You get your money down and wait for the Grammys. Somehow you have to move between these two antithetical points of view. Cautious when forming your convictions, pit bull once you’ve got them. It’s hard – so hard that there are almost no rich gamblers in Vegas. The three guys that were rich (and when I was there, it was only three) knew how to do both.